Teleprocessing Services Contracts for the Support of Army and Navy Recruitment Should be Recompeted

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Both the Army and the Navy have acquired teleprocessing services from Boeing Computer Services Company to support their recruiting efforts. Both are experiencing high cost overruns. The Army's initial cost projection for the Boeing proposal was about $8.5 million for the 60-month life of the contract; it now projects a cost of about $120 million. The Navy's initial cost projection for the Boeing proposal was about $524, 000 for the 42-month life of the contract; it now projects a cost of about $13 million. Both the Army and the Navy used benchmarks to evaluate proposals. Neither benchmark adequately represented the actual workload subsequently placed on the system and as a result was a poor indicator of system life costs. Computer resources used by both the Army and the Navy greatly exceeded the amount anticipated. Because Boeing submitted an apparently unbalanced proposal in which commercial rates were charged for teleprocessing services beyond the projected level, both services incurred costs well beyond that expected. Further, the lack of appropriate management controls--budgetary and cost controls for the users--has also contributed to the problem of excessive costs.Both the Army and the Navy have acquired teleprocessing services from Boeing Computer Services Company to support their recruiting efforts. Both are experiencing high cost overruns.

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Teleprocessing Services Contracts for the Support of Army and Navy Recruitment Should be Recompeted